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![]() | Like u/Criand, not only am I "happy to see that there is a shift from GME DD to macro-economics DD," I would like to add some technical analysis (TA) through indicators to our tool belt, since GME is no longer a meme stock. So let me add some wrinkles for us apes, by giving an overview of the technical analysis (TA) that I have been doing on GME—with an eye to Thursday possibly rocketing due to the T+21 cycle and u/dentisttft's SLD time frame (currently the 11 business days from 06/16 to 07/01). submitted by C2theC to Superstonk [link] [comments] This week, using TA and buy limits, I was able to pick up a fair number of additional shares at 207.00 and the low of 197.00. Disclaimer here that GME is on sale five days a week, fifty-two weeks a year, and I am not giving you specific financial guidance to buy at a certain price, nor to tell you to get on the rocket tomorrow before it takes off. Instead, I am helping you fish for your own bananas, so that you can make your own educated guess on picking them when they are ripe. Note that TA is much like reading tea leaves. While some may scoff at the fuzzy nature of the crayon lines, do realize that algorithms are programmed to trade off these indicators, as they are all mathematical derivations. The purpose of TA is to help increase the probability that you have a property entry. I want everyone to be able to buy more shares of GME. Moving Average (MA)The first indicator we will look at is the old reliable, moving average (MA). The MAs that I like to use are the 15-day (15MA), 50-day (50MA), 100-day (100MA), and 200-day (200MA). The significance of each is covered in an excellent article by Michael Sincere, who is an outside writer for MarketWatch (don't read any other trash FUD articles written directly by MarketWatch), and is basically:
Moving Averages. 15MA in blue, 50MA in red, 100MA in orange, 200MA in purple Exponential Moving Average (EMA)The exponential moving average (EMA) is a type of moving average that places a greater weight and significance on the most recent data points. The EMA reacts more as the price moves, and is an useful indicator for slightly shorter time frames, to better determine when to buy or sell. Investors Business Daily calls the 21EMA the Goldilocks of moving averages. The 50EMA is significant as an inflection point, and also has specific strategies. For example, if you look at the 50EMA for SPY, you will notice that it almost perfectly calls out times buying opportunities (I'll take credit for this observation, because I've never seen this mentioned anywhere).In the chart below, you will see that GME bounces between the 21EMA and 50EMA, and doesn't stray too far from either. This to me indicates consolidation, and consolidation leads to a breakout. Anything you buy between these two ranges may be a good price. Exponential Moving Averages. 21EMA in blue, 50EMA in green Anchored Volume Weighted Average Price (AVWAP)The Volume Weighted Average Price (VWAP) is an indicator used to tell you the relative price of a security, based on the historical volume and price. Anchoring to a specific date, it becomes the Anchored Volume Weighted Average Price (AVWAP). The AVWAP is used to show the proper entry for a stock, as shown in the YouTube video by Ben B.You will want to anchor to previous lows, to understand if we are at a low, relative to previous lows, to determine proper entry. In the chart below, I have AVWAPs on 03/24, 04/12, and 05/10. The TA conclusion that I draw here is:
Anchored Volume Weighted Average Price for 03/24, 04/12, and 05/10 Fibonacci Retracement (FR)Fibonacci Retracement (FR) is one of the harder indicators to use, because there is no formula calculating for you where to place the anchors. Place the anchors wrong, and your entire assessment can be off. Luckily, for the recent GME price action, the FR fits almost perfectly.Anchoring the 1 on the 06/08 high and the 0 on the 06/21 low, and moving the anchor to the right, we see:
Fibonacci Retracement Levels Putting It All TogetherWhen you put all of these indicators together on the same chart, you will notice something interesting—they overlap. All of the sudden, the GME price levels seem very clear. GME has definable buy zones, and possible breakout levels. This is why TA is an art.All Together Now BonusWhile we have seen spikes in the T+21 dates and periods of extra volatility during the SLD dates, one idea that I've been toying with is if there is some pattern in the dips. If you look at the bottom of the chart above, you will notice a series of gold hashes/line. Dips seems to happen around the hashes, though it is not perfectly on these dates, like the T+21 cycles, how GME prices are pushed down two days before the end of SLD, as well as during each Short Interest Reporting Settlement Date (SIR in the charts). I do not understand the underlying cause and there might not be one, and I do wonder if around these dates may be good times to pick up additional shares. This is not TA, and mere counting of the dates on the calendar; it is still interesting to observe. See you all on 06/24 (maybe) 🚀 Chart Patterns *One other TA indicator to consider are chart patterns, and GME really shows its true colors on the 1W chart. GME is forming a classic bull pattern in particular, a very clear Cup with Handle <https://www.investors.com/how-to-invest/investors-cornecup-with-handle-everything-you-need-to-know-about-handles-in-bases/>, though the breakout at the handle has not yet occurred. Handles can retrace around 60%, and should stay above the 50MA (10-week moving average), on which GME currently rests. This also happens to be the lower support at the 02/16 05/10 trend line.The normal recommendation to buy is during a breakout, when the price action moves above the top of the handle, which is around $350. Note that GME is not a normal stock. The entire world is watching this, and seeing this pattern as well. Is this the best price at which to buy GME? I can't tell you that, because the Cup with Handle formation may fail. It can also rally up above all of the other indicators above and break out above $350. You will have to make your own decision on this one. Cup with Handle and 1W Trend Line Support \ 06/27 addendum) |
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